The Commissioner Of Income Tax, Karnal v. M/S Flora Exports

IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH. ITA No. 508 of 2010 Date of decision: 2.11.2010 The Commissioner of Income Tax, Karnal -----Appellant Vs. M/s Flora Exports ----Respondent CORAM:- HON'BLE MR JUSTICE ADARSH KUMARGOELHON’BLE MR. JUSTICE RAKESH KUMARJAIN Present:-Mr. Yogesh Putney, Senior Standing Counsel for therevenue. Adarsh Kumar Goel,J. This appeal has been preferred by the revenue undersection 260A of the Income Tax Act, 1961 (for short, ‘the Act’)against order of the Income Tax Appellate Tribunal, Delhi Bench‘B’ New Delhi dated 11.9.2009 in ITA No.13/Del/2009, proposingto raise following substantial questions of law:- “i) Whether on the facts and in the circumstances ofthe case, the Income Tax Appellate Tribunal was rightin law in deleting the penalty imposed under section271(1) ( c) on the amount of deduction claimed undersection 80IB on export incentives by holding thatthere was no deliberate furnishing of inaccurate particulars by the assessee, given the fact that thedecision of the Hon’ble Supreme Court in SterlingFoods v. CIT dated 15.4.1999 (237 ITR 579)disallowing claim of deduction under Chapter VIA ofthe Act on export incentives was already available tothe assessee at the time of filing the return of incomefor Assessment year 2002-03, and therefore, theassessee was evidently filing inaccurate particulars ofincome in claiming 80IB on export incentives? ii) Whether the decision of the Income Tax AppellateTribunal to delete the penalty under section 271(1) (c)of the Act is justified in the light of the decision of theHon’ble Supreme Court in Liberty India v. CIT (317ITR 218) whereby the non-allowability of 80IBdeduction on export incentives has been re-affirmed? iii) Whether the decision of the Income Tax AppellateTribunal quashing the penalty order under section 271(1) (c ) on the ground that there is no deliberateconcealment is justified in the light of the decision ofthe Hon’ble Apex Court in Dharmendra TextileProcessors & Others, 306 ITR 277 (SC) whereas theassessee had offered an explanation which could notbe substantiated in the light of the Apex Courtjudgment referred in question No.(1) and ought tohave been taken as deemed concealment withinExplanation-1(B) of section 271(1) ( c) of the IncomeTax Act, 1961? It is not disputed that identical appeal filed by therevenue has been dismissed by this Court vide order dated28.7.2010 in The CIT v. M/s Raj Overseas, ITA No.225 of 2010. Accordingly, this appeal is dismissed. (Adarsh Kumar Goel) Judge November 2, 2010‘gs’ (Rakesh Kumar Jain) Judge